Coupon Sites Are Not ‘Margin Killers’

Nearly 70% of people said coupon sites were an essential part of their shopping research process – according to recent findings by global affiliate network Commission Junction (CJ).

The aim of the white paper was to help marketers better understand how coupon sites impact purchase decisions and key findings revealed that deals trump customer loyalty, coupon sites attract new customers and a ‘full’ shopping cart does not guarantee a sale.

The American respondents represent a segment of ‘very active’ online buyers, with 92% shopping online multiple times a week.

President of Commission Junction, Kerri Pollard, said coupon sites are not ‘margin killers’ and are indeed, a true ‘web phenomenon’, as they are an extremely popular resource for value-conscious consumers. She also stressed that voucher users tend to be a very important customer base for retailers.

Highly influenced

“Affiliate marketing is one of the most popular and effective ways for retailers to grow their sales by driving both new buyers, and incremental purchases,” Pollard said.

“While the channel is widely respected for its efficacy and pay-for-performance business model, some retailers have questioned whether including coupon websites in their affiliate programs makes sense.”

Compared to other sources, coupon sites ranked second in usefulness when researching or shopping online.

A total of 58% went for the online coupon site source, 63% argued that search engines were the most useful and 24% said social networking sites were the most useful.

The study found that when committed to making a purchase, shoppers in the shopping basket are still seeking the best deal and are open to being influenced to buy from different retailers.

More than half (54%) of respondents ‘strongly agreed’ that coupons made the difference when they were unsure about whether to make an online purchase.

A total of 53% ‘strongly agree’ that a coupon has driven an unplanned purchase and 52% say they use baskets to assess total costs.

It was also noted that a full cart does not mean a closed sale, as 83% said they ‘often’ or ‘always’ leave to comparison shop.

The research also found that coupon sites do positively impact the purchase journey in three distinct ways: they introduce brands to new customers; they keep an advertiser in the mix when shoppers are comparing prices, and they are trusted sources of coupons that result in unplanned purchases.

Looking for more

Shopper loyalty to retailers is also trumped by shoppers’ loyalty to their own best possible outcome – meaning shoppers seek the best price possible, regardless of familiarity with a retailer.

When clicking away from a retailer’s site to find a coupon, shoppers are still evaluating potential retailers. A total of 80% said they ‘often’ or ‘always’ choose to buy from a different retailer upon finding a better deal.

As part of its effort to provide real research and data to further the affiliate industry, CJ underwrote the quantitative research project to understand the business impact of these sites.

Pollard said the white paper delivers the results of that critical research and clarifies the role these sites play (and should play) in affiliate programmes.

We caught up with Pollard to ask her a bit more about the survey:

Why was it important for CJ to conduct this survey? And how do studies like this help the wider performance marketing sector?

KP: It was important to conduct this survey because we’ve found that marketers often overlook coupon sites because they don’t understand the impact they have on acquiring new customers. We found that the growing popularity of coupon sites is significant, and they really can make a significant impact for brands, especially in driving customer acquisition and incremental sales.

In fact, the study found that 98% of respondents ‘agree’ or ‘strongly agree’ that coupons have influenced them to try a new retailer. Studies like this help the wider performance market because they illustrate how each component within a marketing channel can impact purchase decisions and drive big results as part of an overall marketing program.

What is the key takeaway from the findings?

KP: The key takeaway from the findings is that coupon site users are ultimately price loyal, not brand loyal. They are willing to try new retailers and make purchases from sites they don’t normally visit if they find the right deal on a coupon site. This is an important consideration for marketers, especially as they enter the busy holiday shopping season when people are looking for the best value.

The findings also shows that people are doing their research before clicking ‘checkout’ – they visit other sites and search the web for coupons to make sure they’re getting the best deal.

How can brand marketers utilise this information? What should they be doing with it?

KP: Marketers can read this information to better understand the coupon site phenomenon and how value-conscious consumers are shopping. The data builds a clear case for the business value of coupon sites, and marketers can keep these findings in mind as they evaluate potential coupon site partners and try to identify the best partner to help them reach their customers. We know that many online retailers still struggle with whether or not to include coupon sites in their affiliate marketing programmes, however the data shows that excluding coupon sites may mean losing customers to competitors who are offering the right deals on coupon sites at the right time.